Former U.S. attorney to head port's internal inquiry

By KRISTEN MILLARES YOUNG, P-I REPORTER

Published 10:00 pm, Tuesday, February 12, 2008

The Port of Seattle Commission will hire former U.S. Attorney Mike McKay to lead its internal investigation of the port in the wake of the state auditor's blistering critique of the port's construction management.

That report found nearly 50 indications of fraud, but producing evidence to substantiate that fraud -- defined by Black's Law Dictionary as "a knowing misrepresentation of the truth or concealment of a material fact to induce another to act to his or her detriment" -- was outside its scope.

The port decided to do its own review of what happened, and the commission decided that such an investigation would have to report directly to it, rather than to Chief Executive Tay Yoshitani. While that review is occurring, the federal investigators will likely be pulling port employees into fact-gathering interviews for which the commission has approved hiring outside counsel to represent them.

In an important development Tuesday, the commissioners decided that the port would not pay for the legal defense of former employees, effectively cutting out retired port chief Mic Dinsmore.

Though what it will cost is not yet known, during the investigation's early phases the port will pay for its employees' counsel, should they request it and agree to cooperate fully with the investigation.

The port has also hired a team of lawyers to represent its interests in the federal investigation, which could lead to criminal and/or civil action.

The port's internal audit reporting has also been shifted: Now internal audits are reported to an audit committee formed by Commission Vice President Lloyd Hara and others.

That realignment is part of what Commission Secretary Gael Tarleton has called putting "an arm's length" distance between the commission -- an elected board of five part-time overseers -- and the port's staff.